How Contactless Payments Work
As we get used to the new “normality” of shopping during the coronavirus outbreak, you’ve likely seen companies touting contactless transactions.
In many stores and restaurants, this means you pay online before picking up your order at the sidewalk or pickup location, which doesn’t require you and your employee to manually exchange anything.
But contactless transactions also refer to a payment method in person, which allows you to pay without inserting a card into a terminal or handing it over to a cashier. And its use has skyrocketed as our activities have been restricted by the coronavirus.
According to Mastercard, in the first quarter of the year, the growth of contactless transactions worldwide was more than 40%.
Contactless transactions have grown twice as fast as contactless for grocery and pharmacy purchases – some of the few places where many of us have made in-person purchases in recent weeks – according to a survey conducted by the payments network in February and March.
Contactless payment can be done with a debit or credit card, but it can also be linked to your finances through another method, such as a key fob, smart watch, or mobile wallet on your phone.
Nearly 80% of respondents globally said they now use contactless payments, with safety and cleanliness being the main motivators for choosing contactless payment methods.
So what should you know before buying?
Check your wallet
First, decide on your contactless payment options. If you’re already using a mobile wallet like Apple Pay or Google Pay, you’ve probably already set up to use your mobile phone for contactless payments from the accounts you’ve linked to those services.
If you pay with plastic, check for a symbol on both sides of the card that looks like a side Wi-Fi signal. This means that your card supports contactless payment.
Check Signature Limits
Your contactless card has the same spending limits as the account linked to it, but there may be some restrictions when it comes to the amount of your purchase.
Some card issuers and payment networks set thresholds that allow true contactless payments for small purchases only. For example, if you use Apple Pay to purchase more than $ 50, you need to sign the transaction.
Since you usually do n’t need to sign a credit or debit payment under $ 25, this is probably your cut-off point for contactless payments. (Results from a Mastercard survey found that 80% of contactless transactions are in purchases under $ 25.)
Alternatively, you can spend as much as you like, but you will have to sign the receipt or on the screen of the payment terminal.
But check the rules of your card to find out the exact amount – and don’t be surprised if it increases at some point.
In the UK, the contactless limit has been increased from £ 30 to £ 45 to accommodate physical distancing, while in Canada the limit has been increased from C $ 100 to C $ 250.
Follow the instructions in the registry
If you’ve never made contactless payments before, look for that Wi-Fi symbol on the side of the payment terminal, but you can also expect companies to be loud and clear about their ability to accept contactless payments.
While this is sometimes referred to as “push-to-pay,” keep in mind that your card or mobile device doesn’t actually need to communicate with the payment terminal to process your payment — it just needs to hover an inch or two. over it.
And it’s fast – much faster than waiting for a chip transaction to be authorized. So pay attention and be ready to go off the register as soon as your transaction is complete.
Have you noticed an increase in the number of contactless payment methods in stores where you shop since physical distancing attempts began? Share your experience in the comments.
This post was edited on 5/7/2020 to clarify that contactless payment limits are intended to opt out of requiring a signature on purchases, not to limit the amount you spend.